economicmultipliers_26

Economic Multipliers (26)  
 
Do you know what these are?
They help CREATE wealth in systems.
Knowing what statistics to pay attention to … what probabilities will most likely have the greatest impact on your life … is an economic multiplier to you.
 
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This is the accident you probably will never have:
  • While driving a company car (not yours) to a company holiday party in the Boston area on a somewhat wet, rainy, glary night, you start to go when the light turns green at an intersection.
  • All of a sudden, everyone slams on their brakes in front of you so you do too (you have no idea why and never find out).
  • The driver coming up from behind saw the light go green, your brake lights go off, and knows that the cars ahead of him are now moving.
  • He doesn’t slow down as much as he would have if he had been expecting to stop.
  • When he realizes he has no chance of stopping, he does the next best thing and swerves over into the lane on the right which has recently emptied of cars because the sign along the street notes that cars can only park there until a certain time.
  • By the time he is able to stop, his back bumper is ahead of your front bumper and he has only ‘taken out’ the right hand back corner of your vehicle (or more like pushed it into the right rear tire).
  • You are uninjured.
  • A police officer immediately shows up, indicates he was at the intersection, saw what happened, knows the accident wasn’t your fault, tells you so and immediately starts taking a police report while asking you if you can move the vehicle.  You indicate no because the body of the vehicle is now pushed against the tire.
  • The spiked eggnog that’s in milk jugs on the floor behind the front seat (a gift for the party’s host) has not spilled.
  • The leftover bottles of alcohol (from making the eggnog – also destined to be a gift to the host) have rolled under the seat.
  • The car does not smell of alcohol (which is good because you have not been drinking).  The eggnog was made on a prior day and ‘tested’ then.  Because you’ve had a no drinking and driving policy for years, on this night, you are a designated driver.  The closest you’ll get to alcohol on nights like this are one drink (but usually none) and ONLY with food and AT LEAST 2 hours prior to considering driving.
  • The police officer checks inside the vehicle and probably turns on the emergency flashers – it’s highly unlikely that you thought of it:  something like this never happened before.
  • An individual (whom you never get the name of – but thank you) shows up with a tire iron, offers to pry the vehicle away from the back tire and then does.  Not only are you able to move the car, but you are able to drive it to the party and later back to the company’s parking spot.
  • The passenger in your car – a fellow coworker – is fortunately uninjured too and agrees not to mention the accident to anyone at the holiday party until just before leaving the party so you do not have to tell a car accident story all evening.
  • When you get into work the following Monday, the individual who handles the company’s fleet of cars asks you why the back corner of the vehicle is smashed in and why there were half empty bottles of alcohol under the front seat of the car.
  • You realize that you forgot about the extra alcohol and explain why the bottles were there, that you had not been drinking that evening, the accident was not your fault, a police report was filed, and you have all the relevant information the company needs regarding the accident.
  • The manager of the fleet notes that the company had been planning on getting rid of the car (a field vehicle with a good number of miles and wear and tear on it) and almost makes you feel like you did the company a favor by getting into an accident where no one got injured.
THAT is the accident you will probably never have (and the accident I did have).

YOUR most likely accident (should you ever get into one):
  • will be in your car,
  • your insurance rates may go up (and possibly for several years – taking dollars out of your pocket that everyone else around you will have in theirs),
  • you’ll have to cover the deductible on your insurance policy before the insurance company pays for anything,
  • you may lose your license if you’re doing any drinking, drugs or anything else illegal (like surfing the web),
  • you could get a costly ticket,
  • you might get killed or seriously injured (imagine losing a limb or anything at a young age or needing to relearn anything – walking, talking, or any of the skills you learned over the years, etc. during a time when your friends are just ‘going about’ their own lives – not having to deal with any of it),
  • you may have to find alternate transportation, and
  • even if the accident is not your fault, it will cost you time and money (unless it’s someone else’s vehicle and no one is injured).
Economic multipliers for you are about time and particularly money.  You DEFINITELY do NOT want to have to pay MORE for everything than the people around you … especially over the course of many years.

Appreciate that you cannot control every event.  You may end up in a car accident (or some other kind of accident) someday that was totally unforeseeable and that you did NOTHING to cause.  And that accident might cost you time and money.  When those things happen, remember that it is never possible to control every event.

It’s the events you CAN control that you should pay particular attention to.

When I got into the car accident in Massachusetts, I found out there was a state law that said that if your car was hit by someone from behind, it was automatically their fault because they were following too close and/or driving too fast.  When I lived in Colorado, they had a law that said that if you hit a skier from behind, you were at fault because reckless and/or out-of-control skiing has gotten people seriously injured and even killed.

Accidents, injuries and deaths are rising quite rapidly because of our personal CHOICES.  Insurance rates (the dollars that come out of your pocket) are based on those things.

A bumper can cost $200 to over $1000 to repair.  Particularly for young people, insurance rates can double if you’re in an accident that involves ‘inattentive driving.’  You could even lose your insurance if you do something that is against the law (like drink and drive).  But the worst for you would always be if you were personally injured.  Money can be replaced:  You can’t.

When you get insurance, you should remember that insurance companies are in business to make money.  Their business is about ‘sharing risk’ in the event that something bad happens.  But they can only make money IF they are doing business with people who don’t purposely CREATE risk.

When I got in this car accident, ‘inattentive driving’ was not an issue … speed was … and I consider myself ‘lucky’ that the driver of the car behind me had the presence of mind to swerve into the right lane and even luckier that the right lane had recently cleared of parked cars and not yet filled with moving ones.  Because he maintained control of his vehicle, it wouldn’t surprise me if he had at one time raced cars.

Insurance companies today will probably tell you that your (and everyone else’s) car insurance premiums are going to rise dramatically (even if you don’t have an accident) UNLESS people (in EVERY age bracket) are willing to give up the use of electronics while driving and pay attention to the road.

Don’t even ride along with someone who uses electronics while driving.  Insurance companies are starting to equate the ability of these drivers to stay out of accidents as similar to that of a drunk driver – protect yourself.

A million people could tell you that if you are in any kind of accident, you could be poorer (in the long-run) than your friends.  But the ONLY person that will ever count when you make your decisions is YOU – because you will always base your decisions on what you tell yourself.

You will make your OWN choices but I would say to you:
  • Don’t be a statistic or make someone else one … and don’t PURPOSELY mess up your own economic multipliers.
  • Change your probabilities and the probabilities of everyone around you for the better.